Sunday, September 16, 2012

Compat overturns fine issued by the Competition Commission of India (CCI) to Kingfisher for alleged non-compliance

Neelam Mathews

Sept 16, 2012

Amid all the news breaks, we missed
writing on the judgment of the Competition Appellate Tribunal (Compat) which
has annulled a fine issued by the CCI to Kingfisher Airlines.

Non-Compliance
Image Source- cattlelogos.com

The 10 million rupee (about EUR
145,000) fine was the first penalty levied by the Indian Competition Commission
under the Competition Act 2002 where Kingfisher was sanctioned for allegedly
failing to supply information in the context of the CCI's investigation into
the company's alliance with Jet Airways.

"Kingfisher appealed to Compat, which set
aside the CCI order and remitted it for consideration. Compat found that
the letters sent to the airline were notices of extension and not, as argued by
CCI, reminders to comply with the original information request. Compat
found that the CCI failed to distinguish between a failure to comply and late
compliance. In respect of the latter, there is only failure where the relevant
time period and extension has expired," said Suzanne Rab, Partner, King
& Spalding to Aerospace Diary.

"In January 2012, the CCI
imposed a new fine amounting to 7.2 million rupees which was again challenged
before Compat. In annulling the fine last week Compat has yet again
distinguished between notices of extension and reminder notices. Viewed in the
context of Compat's earlier ruling, it considered that the CCI had acted
beyond its powers in levying a 7.2 million penalty and that this could not
stand.

"The case has been going on for
some time and the latest ruling by Compat has clarified one procedural matter
at least, namely that a distinction needs to be made between reminder notices
and timing extensions. It sends a strong message to CCI in terms of how
it drafts correspondence such that there be no equivocation on what is required
by the company to comply with its directives.

"Compat clearly has an
important role to play in terms of judicial oversight of the CCI's decisions
both in matters of process such as the instant case and in its substantive
assessment, “ adds Rab.

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About Me

Am presently contributing editor to numerous international publications on business aviation, defense and commercial aviation. Also write on construction for ENR, a Mc Graw Hill publication. Travel has been a passion that I will carry with me till the end. Write for lifestyle publications and travel on a regular basis. Organise webinars and round tables on subjects I understand!Contributed to Aviation Week for 12 years writing on aviation, space, defense, overhaul and maintenance and business aviation. Was Editorial Director to 3 MRO Asia events in Singapore and Hong Kong.